"That means that what Amazon is really looking for is something else: that special something."
Massive tax breaks and giveaways. That's all this is about. It's a dog and pony show to see who will fork up the most to buy in to the delusion that it will pay off somehow.
That's what I suspect. Ask for all these things, and then wait for states and municipalities to say "Well, we don't have all of those, but here are a massive tax breaks in return".
It's sad watching cities fall over themselves to give Amazon (a half a trillion dollar company) a handout. Handouts no one can afford.
> (but where cities take the hit if the company town fails)
As a country [1], states [2], and many municipalities [3], we're very much insolvent as it relates to future obligations. Could we please stop supporting reckless behavior making it worse?
I suspect having a good talent pool, good infrastructure, and a responsive city government is worth more to the company than a few billion dollars in tax breaks.
This is a very bad idea .. there is no need for so many people to sit in one place and terrible for housing and commute. Amazon should come up with a better idea .. this is so not like Amazon.
Isn’t it more efficient for cities to have density like this? For example, you could triple the city busses to a specific location during work hours, a many-to-one relationship rather than many-to-many.
Only if affordable housing is enabled through policy. Otherwise Amazon is just creating a company town bubble within a town, driving up housing costs with the salaries they pay their workers.
I hope they flip the table, declare all proposals inadequate and build their own damn town. Negotiate directly with a state or the feds for land and do everything the way they want it.
If Musk can die on Mars, Bezos can damn well own a county.
Cute idea, but they've said their #1 priority is to be somewhere where talent wants to live, ideally complementary with Seattle:
> “Not everybody wants to live in the Northwest,” Wilke said. “It’s been terrific for me and my family, but I think we may find another location allows us to recruit a different collection of employees.”
Newville is a great place to live. Brand new infrastructure, good schools, and the kind of stores that cater to People Like Us. Sure, it's not the most exciting sort of place, but it's great for kids and families. And Big City is only two hours away, easily close enough when you want something different.
Right, but if Amazon pre-selects from a menu of the former, then cause a competitive bidding war for tax breaks from compliant cities then that's even better from Amazon's perspective isn't it? I personally disagree with the approach, but I would guess that's why the search was publicized.
And what is particularly galling about Amazon is they essentially pay no taxes. Since 2008, Amazon has paid $1.8B in income tax while Walmart has paid $64B [1]. So they're basically leeches demanding public services while contributing virtually nothing. As someone whose name I've forgotten said, the fundamental question surrounding silicon valley / SV type companies is how do you run a country when a company with $0.5T market cap / Fortune #12 essentially pays no taxes. Who pays for roads/fire services/schools.
Do the thousands of employees contribute economic benefit, as well as taxes, to Seattle or other cities?
It's absurd to think that there is no tax money being injected into the city simply because the corporate tax collected is low. They are spending their profits! Some of it in Seattle, and in other places they have physical presence on wages, real estate, etc.
Honestly you need to explain your premise that they contribute nothing... it's illogical. Where is the money going?
Why are "taxes" the only way citizens of a community can prosper? Do wages not count? If they do count, would you like to argue that Amazon is not paying wages to thousands of employees?
Do those employees pay taxes? Taxes aside, are the wages themselves beneficial?
One final point: "tax breaks" in and of themselves seem silly to rail against, like a shareholder being upset at "discounts".
Is your contention that a city giving any tax breaks will see less tax revenue as a result of Amazon coming into their city than if they didn't? Surely it's a question of how much no?
It's a prisoners dilemma - if no cities offer tax breaks, then Amazon likely still chooses a site in the US, and we all benefit from better balanced gov't budgets (or if there is enough incoming flow - we could lower tax rates in a fiscally responsible way - imagine that). If some cities defect, then well it breaks down to forgoing taxes and public budgets get harder to meet. Federal grant programs should look hard at cities applying for funding who may have given up local tax revenue to attract private corporations.
I dispute the claim that, on net, they would be "giving up" tax revenue. Or at least, the particulars matter.
Above some threshold, which can still be very low, they are going to get massive amounts of tax revenue, aside from the fact that wages, jobs, and citizens paying taxes will increase.
You might dispute this, but I don't see any numbers or qualifiers with anyone saying "tax breaks", in and of themselves are always on balance, whatever the specific details, worse than not having the companies be there.
There are lots of debates on the correct form of taxes anyways. Corporate taxes of non-trivial rates seem pointless to me, or.. detrimental actually. Property tax abatements? No different from a landlord giving rent deferrals to a whale tenant. It can be a very practical choice
Politicians' incentives not being aligned with long term goals of a city? Yes.. that is a problem. But still. The right choice could very well be massive tax breaks, even among those of differing political philosophies.
Suppose no cities offer tax breaks and Amazon grumpily decides to establish a second headquarters anyway wouldn't the tax revenue in that be higher as a nation than if one city offers breaks?
I sort of agree only on corporate tax breaks - pragmatically there is little point keeping them so high that most international corporations keep their profits offshore. I'd favor lowering corporate overseas rates, but only in combination with increased enforcement against tax avoidance schemes. But to me thats an unrelated to local city/state tax breaks given to corporations.
At the end of the day a lot of this seems like sort of an accounting question.
Since Amazon uniquely doesn't earn much profit, preferring to invest / spend as much of their revenue as possible, one could argue that there is an opportunity cost to collecting more money from Amazon in taxes vs leaving it to them to spend how they see fit. The cost is whatever alternative use they would place on that money... more employees hired, higher wages / benefits, more R&D, more capital expenditure, more construction, who knows.
Or course, in every one of those cases, there would likely be taxes involved anyways...
We do know. Taxes are already fairly low in the US. Kansas ran a broad scale experiment with dramatically lowering state taxes - the results indicate that some magic growth is not unlocked. My conclusion is that cities are just giving up local budget balance for little benefit.
Thank you for articulating this, @PKop... All of this negative sentiment around Amazon's impacts in Seattle and now HQ2 are missing the strikingly obvious benefits of having a top-notch employer in town.
Good jobs are the lifeblood of any community, and Amazon has provided them in spades in Seattle in a way that is far from extractive. They buy land and build on it and have transformed South Lake Union from a dead, dangerous warehouse district into a thriving neighborhood in ten years time. [1]
Almost all of the "problems" that Seattle faces due to Amazon's presence are problems that hundreds of towns would gladly take in exchange for the tens of thousands of high-end jobs that would bolster their community. [2]
There are so many communities across the US that have much bigger problems. Like lack of jobs, population loss, budget shortfalls, unsustainable public pension benefits, opiate epidemics.
For many, giving up some taxes from a company that isn’t currently there is a no brainer.
Since our current system uses taxes from both employees and companies, it should be obvious that taxing employees alone doesn't cover our bills.
Wages by themselves are not beneficial because cities and countries require money to build/maintain public works.
The history of cities giving tax breaks to attract business and that resulting in a net positive outcome for the city is very very slim. See eg any economist (except those paid for by sports teams) that's covered this.
Actually, Washington state taxes revenue not profit. It's a terrible system but Amazon is certainly dodging paying taxes while running a vast amount of their business out of Seattle.
This might not be as big a part of their calculation as you think. Homegrown companies like Microsoft and Boeing avoid paying tax by incorporating in different states.
>> Can any city provide a net increase in 5,000 housing units? Well, that’s a speculative question, but one thing we can do is ask if any city did produce 5,000 extra housing units beyond household formation over the last 5 years
Calgary (Alberta, Canada, not Texas) added triple that in 2014[1]. Since the province's economy is commodity driven the major city centers are accustomed to boom and bust cycles and are used to adding housing quickly. Also of note, Calgary has rated quite high based on a number of other metrics given by Amazon[2] (though, to be fair its really hard to trust all bias is left behind in these analyses)
The #1 problem with the article is that it restricts the analysis to the U.S.. With the current political climate around immigration, Amazon can't easily bring engineering talent from around the world to its headquarters. A site outside the US could solve that. The RFP said "North America".
It may be true that no city fits what Amazon wants, but I think Atlanta comes very close. It has plenty of housing, low cost of living, major airports, universities, a large population, and a decent rapid transit that could be expanded given a catalyst like Amazon. I think Amazon should opt for a low cost, big city, and let that city build around Amazon.
>It has plenty of housing, low cost of living, major airports, universities, a large population, and a decent rapid transit that could be expanded given a catalyst like Amazon.
I live in Atlanta and all of these things are true except that last one. MARTA has neither the coverage or the competence to qualify as 'decent'. Even if they plopped the HQ right on top of Five Points (as is being proposed), most employees are still gonna drive, and encounter that world-class ATL rush hour traffic.
That said, Atlanta is still definitely in play, and our department of economic development (which I used to work for) is one of the most effective in the country. They brought Hollywood to Atlanta already, Amazon shouldn't be that much harder. Culturally, I expect it would encounter a mixed reception.
MARTA has neither the coverage or the competence to qualify as 'decent'.
Compared to New York, Chicago, DC, Boston, or SF sure. Assuming Amazon isn't going to expand to a more expensive city, the only competing subway system is in Philadelphia. MARTA is unpopular, but cleaning it up and buying new trains is cheap compared to digging new tunnels through an existing city. No one points out that the Gulch site is currently a wasteland because we all know that if Amazon shows up, it won't be.
The gulch is next to Phillips Arena and MB Arena- imagine the traffic during a weekday ATLUTD game and a hawks/concert. It's alot of wasted vertical space for now, but useful for temporary gatherings; we used it as a basecamp for a film shoot a couple weeks ago. I suppose they could rip out and replace Vine City with Amazon-friendly housing, but that would cause some issues.
Imagine if Amazon built something in the southwestern part of the city, that desert Sylvan Hills, or Lakewood Heights. Amazon would gentrify south Atlanta faster than a parking ticket on Edgewood.
MARTA coverage is only a problem if you don't choose your work place or housing with it in mind.
500k people ride MARTA every week day. As long as Amazon builds their HQ close to a station plenty of the workers will have the option to live close to one, or drive to a park and ride as opposed to dealing with the traffic.
I have a home in Atlanta, and so I share in your pain about Marta. There's a lot of societal resistance to Marta, for various reasons I won't get into because I sense you know them already. With a major player like Amazon, the city (and counties for that matter) could afford to ignore the people and plow ahead with expansion. Imagine a giant, beautiful parking deck, a-la-Lindberg up in Cobb County somewhere.
Park and rides are extremely expensive, and provide little capacity. At $20k to $50k per parking spot, filling trains that move 20k people per hour becomes a very expensive proposition!
Much more likely is transit oriented development, where the 5 to 6 blocks on either side of each station is built up to let people live a short walk from transit.
I disagree. I found your statistic buried in a report but it isolates that statistic to "metro Atlanta" which is, indeed, significantly higher.[0] Building a transit station with garage parking outside the perimeter, particularly up 75 towards Kennesaw, would cost less.[1] About the same up into Douglas County, and some of the more blighted, lower income communities outside the perimeter. [2] Additionally, I don't think you're fully accounting for AMAZON. Let's say for talking purposes Amazon chose Cobb County as the place for its new HQ. If Amazon placed a requirement on the State that there be a transit station for the HQ, I think it would be very hard for the state to say no for that. Look at the boondoggle, sorry, the elevated highway, they just built down 75. Nobody really asked for that, or saw that it was really a necessity, preferring instead for Marta, but the State plowed ahead none the less. My original point is that suburban Atlanta offers an excellent opportunity for Amazon already, but the state will come along, they will build the infrastructure, and they will appease Amazon's needs.
Huh? Unless your in the middle of nowhere, the prices I quoted are the going rate for building park & ride spots all over the West Coast, from Seattle to Portland to San Diego, you literally cannot build parking cheaper than that. The land costs what it costs, then you have to pay someone to improve said land, either paving it, building a parking structure, (which is how you end up with $50k parking spots) and then maintain said facilities for the next decade.
Also, no way Atlanta is getting Amazon to build out there. The car culture is stronger than Austin, and the cops in ATL make Texas and Seattle cops (which are under federal consent decree for brutality and racial bias) look downright nice.
Never, ever ever let a cop catch you with any substance of any kind down there either, or you'll catch a felony quicker than you can blink. I can fill both hands counting former Atlanta residents who moved to Seattle after getting felonies for minor amounts of marijuana, those prosecutors down there are crazy.
FWIW when I lived in midtown and worked in Dunwoody I had excellent MARTA usage. It took my daily commute to a very predictable 45 minutes door-to-door.
Now that my walk to marta is 20 minutes and on east-west line I am using it less, but would if I worked downtown. <shrug>
The problem with Detroit is they would have to import nearly every worker. Plus you need to convince all of those workers to move to Detroit. There may be some overlap between former autoworker and whatever it is Amazon wants, but there's still going to be a gap.
There are a lot of places around Detroit for people to live if they weren't comfortable in Detroit. There are some extremely nice suburbs that you can commute to/from in 30-45 minutes which is still somehow an acceptable commute time compared to most other large cities in the US. You also have to consider that you can live in a 3k sq/ft house with a nice yard for 200-300k. That's very appealing as a tech worker looking to get out of SV or other "hot" tech areas.
As for importing workers, I think you'd be surprised how many tech companies are in the city already, I've seen a lot of people who suggest that Detroit is a top 10 city in the US in terms of work, one example is here: https://www.forbes.com/sites/joelkotkin/2017/03/16/technolog...
I think it’s a fallacy to say it’s hard to move people given today’s tech and capabilities. Also given the over crowding of current tech centers.
You also have to see it from Amazon’s stated goal. They said they want a viable second Headquarters. They want some place that could function if the other place went down. Detroit fits that.
Detroit has one of the largest concentrations of engineers in the country. Granted I'm sure a significant percentage of those are specialized in fields Amazon isn't interested in, to say they'd have to import nearly every worker is a bit extreme. Amazon even has a small office in the city already.
There is little to no way Amazon is going to be able to import their workforce to live in the city of Detroit. A whole lot of the housing options there are extremely outdated or require extreme renovation, the city’s infrastructure is in crumbles, and blight is still a problem.
Source: I have some friends that live in Detroit. Like, the actual city, not the Detroit Metro area.
Housing is not the issue in Detroit. There's no major city with more room to grow housing / office space than Detroit.
The only thing that would hold us back is infrastructure. We have virtually no public transportation, and the influx of all the Amazonians would take traffic to hellish levels. But to me, I see that as a positive. We need a wakeup call to finally overhaul our public transport.
Room to grow housing and office space requires a whole lot of development to happen. My greater point is that there is very little incentive for most people to move to Detroit compared to other locales that are further along on actually having a lot of the type of housing that is popular on the west coast, some semblance of working public transport and infrastructure, etc. The M-1 Rail is a good start, but I think we are still years from Detroit being a truly viable choice.
There are better options than Detroit for this largely just because Detroit is very far behind other cities that can offer some of these needs now and grow into the future ones. Detroit is still at the stage of needing to grow a bit more to support the influx.
I don't see any lack of incentive outside of poor infrastructure but hey, it doesn't seem to stop LA.
The M-1 rail is a joke. It goes from New Center to downtown, which is like a 4 mile stretch. It's the People Mover 2.0, public transportation lip service. It doesn't connect the burbs to the city, which is what we need. Not a personal shuttle for Quicken Loans employees living in midtown.
Our problem is that the northern suburbs get to vote on public transportation and they always vote against it. People who live in the burbs closer to Detroit (Ferndale, Royal Oak, Oak Park, Hazel Park, Roseville, etc) want to be able to ride something into the city so they don't have to deal with traffic and parking.
I can't say I care very much one way or another wether Amazon comes here, I just disagree with the sentiment that Detroit is unworthy of it.
Nevermind that rail in LA waits for cars, cause we can't delay cars more than 50 seconds, oh no!
Seems ridiculous to me, when a train approaches an intersection, you should have bollards come up and the train should always take priority. Moving hundreds of people is a higher priority than moving a few dozen, but yet the train is the lowest priority in LA intersections, and grey crossings aren't properly defended against idiot drivers crashing into trains.
As sfbay demonstrates, merely creating very high need for good public transport does not come close to guaranteeing said public transport will be created.
Also, IIRC, a lot of the "cheap" property in Detroit has substantial back taxes any new owner has to pay on top of the hassle that comes with basically replacing a house from the foundation up.
Merely being difficult to do does not mean something should not be done. Having a root canal done is hell but it’s better than the alternative. The economy has been pushing resources where its easiest. That’s why Detroit lost its industry and ultimately at root of all the economic struggles in the US. It’s much more easy to advocate to locate somewhere difficult than any UBI implementation, as an aside.
Further, to my understanding of Detroit's current situation, the city/local government could grant Amazon entire zip code blocks of commercial/industrial real estate for its purposes. Repurposing and renovating/rebuilding already existing structures will always be cheaper than going from the ground up.
As one senator once said. “I don’t need you when it’s easy if I don’t have you when it’s hard”.
Detroit would be a tough sell to six-figure earners. Huge crime rate, terrible schools, dysfunctional bankrupt government, lack of local talent. Maybe an affluent suburban community outside Detroit, but those aren't going to be supportive of a huge new corporate HQ with all the traffic, construction, etc.
I come from neighborhoods that are close to Detroit standards... I would move there as long as properties don't come with tax liens (which I remember reading was an issue a couple of years ago)
The premise is interesting, but some of the calculations aren't convincing. The first map of cities that "did produce 5,000 extra housing units beyond household formation" is particularly strange. Which city is more prepared for such an expansion, one that built zero units and lost 5,000 residents, or one that built 100,000 units and gained 100,000 residents? Without greater clarity into the data, many of these maps fall into "lies, damn lies, and statistics".
Yeah, that struck me as odd too. Under normal circumstances, you wouldn't expect private developers to build that much excess inventory on spec with no expectation of being able to sell quickly.
In the 6 years from 2010 to 2016, metro Atlanta has added 94,000 "housing units". No one would even notice an extra 5%. Over the same period we also added 259,000 jobs, and 4% more isn't going to fundamentally change anything.
Completely unrelated to the topic at hand, but I've gain a new-found respect for Medium, having not seen this on the site before:
"This embedded content is from a site that does not comply with the Do Not Track (DNT) setting now enabled on your browser.
Please note, if you click through and view it anyway, you may be tracked by the website hosting the embed.
Learn More about Medium's DNT policy"
I think that's the first time I've seen visible evidence of the DNT setting actually doing something. Now whether or not that offsets the header/footer turds that litter their mobile site, I'm still deciding. :-)
I don't think that's true. I would certainly classified the tribes in the Amazon who get killed or pushed out of their homes by loggers and ranchers as displaced due to deforestation.
If you are imagining a rain forest as something full of people, just forget it. For population density concerns, the main difference between a forest and a desert is that people can traverse the desert, so you will find way more of them there.
When tribes and agriculture exist near each other, you will see economical interdependency, not one population pushing the other away.
Everything about this article is kind of dumb. Using this exact same argument, it would be impossible for any company to build any headquarters, and yet somehow the American economy still continues to grow.
It's not like amazon is going to airlift in 50k people on day 1.
Anyway, Northern Virginia is still the obvious place for second HQ, given metro access to DC, Dulles airport, the millions of datacenters, fios penetration and large numbers of local it workers.
I agree that the article fails to explain why a city can't increase it's housing creation when the market demands (sort of like most places already do, albeit with issues).
BUT I think it's fair to point out that Amazon going anywhere where it represents a large change in the population will have a notable housing impact. Construction lags behind demand and the current markets in high tech areas have lots of problems with difficult local regulations, extreme rents, very limited availability, and general gentrification issues. Amazon will likely be a net positive for wherever they go, but it's a good idea to anticipate and try to reduce the inevitable negatives.
I want to disagree with your NoVa conclusion, but I can't. It has location, population, infrastructure, though transportation is notoriously bad - almost always ranked worse for traffic than San Francisco and Seattle, usually beating Boston, and challenging LA depending on what you measure. (that's from memory and a few google searches to make sure I'm not crazy, take with salt) North Carolina would be the next natural match, but I don't see Amazon taking on that political mess.
But do they want to build that ecosystem from scratch? My amazonian friends imply that while it's easy to get applicants, they have as much trouble finding the people they want as anyone else in their current tech saturated area.
If Amazon moves to Podunksville, it will "work". Given that they're looking for deals, it will almost certainly be successful as far as "does the office function, is it a net positive to our productivity". But what is already at their new location will definitely impact what happens for the first few years as the local economy shifts. Pulling in 90% of their workforce from remote with a tiny hub airport that has only 2 non-stop destinations is very different from pulling 50% of their workforce from remote with an international airport with non-stop flights to most major cities. The reverse effects are true as well - getting people in where the local cost of living makes every dollar worth $1.20 grants a benefit vs a local cost of living giving you $0.90 spending power per dollar.
Heck - Moving to Seattle was wonderful for my wife and I in lots of tiny ways: People aren't confused when asked about vegetarian options, assuming it's not already clear on the menu. Our various hobbies and entertainments are well represented (Heck, I play tabletop RPGs and a good chunk of the major companies are actually _here_) It'd take a notable bit more to get me to go to somewhere where eating out is a chore, where I have to deal with the 5 local adults willing to play a "game" regularly and have to put up with their quirks because I have no other options, where I have to deal with religious evangelism on a daily basis, where you have to drive everywhere, where the weather is extreme, etc.
This isn't a question of success vs failure, it's a question of how to maximize their success. And the success of the local area, including the current residents.
With AOL closing up shop in NOVA, theres a huge real estate gap that Amazon might be over to take over too on top of all the other speculative talk Northern VA already offers. I'm sure FFX County / Loudoun will place an appealing bid.
Let’s go over this. As a previous DC metro area resident, I agree and disagree with this statement.
1. Transportation: the vast majority of workers in NoVa drive to work, either to drive to Metro or drive to their workplace. Traffic is unacceptably bad now. Going from Bethesda to McLean, which is about a 15 mile drive, can take over an hour.
Solution: Amazon locates west of Manassas, in Front Royal or Leesburg.
This still puts them close to their us-east datacenters, but it’s still far from nightlife and city attractions for their workers. Maybe Richmond would be better, except there is a dearth of tech workers there.
That's not fair. The article is pointing out that Amazon's criteria are unrealistic, and implying deliberately so. It's not implying that companies can't relocate headquarters.
When I was in Chicago the other weekend there was so much talk about Amazon moving their headquarters there, with a number of possible sites including the Old Main Post Office.
There is a building boom going on right now. Chicago has 54 high-rises in construction, many with residential living space. Some are smaller 50-unit buildings and the biggest, One Grant Park, has 792 units.
I think Miami makes a lot of sense, and housing has always been one of the top reasons.
Notwithstanding what this article suggests (a little hard to follow), Miami housing numbers are as follows:
About 12,300 new condos are expected to be completed in downtown between between 2014 and 2019; between 2004 and 2009, more than 21,000 units were delivered.
And this is just downtown, “Miami” itself is a sprawling area with development continuing South and West where it’s suggested Amazon would set up shop. In fact some of the housing development has even been paused due to to much housing coming on the market and lack of demand (though the demand is actually there, local wages are not, reading between the lines foreign investment is drying up). Still the developers (deep pockets) want nothing more than to keep the good times rolling and bringing in Amazon would be instrumental.
Miami strikes me as an atrocious long run bet for amazon. Rising sea levels + stronger + storms + porous ruck under Miami mean the city will be under increasing strain. And sooner than most people living there think.
I'm sure you can buy an over priced condo anywhere, but are there 30,000+ units available in those markets, which in my estimation is the point of the article vis-a-vis a housing market that can support 50,000 Amazonians.
And I'm not going to knock Seattle, there is nothing wrong with cold, wet, dark and depressing...but there is something to be said about the year round Tropical weather Miami has to offer. Its why Miami has snowbirds and our number 1 industry is tourism (discounting Medicare/insurance fraud).
There's a precedent I'm aware of for a wholesale move. RAND Corporation did this in the 1950s, moving from the east coast to Santa Monica, putting entire families on trains to head west (young man, and grow up with the country...). Mentioned in Martin Campbell-Kelly's book:
Interesting to see parts of NJ highlighted in the list. NJ used to have a huge tech sector, accommodating RCA, bell labs, AT&T, etc. but hasn't found strong footing in the software age. The old bell labs complex in holmdel (https://en.wikipedia.org/wiki/Bell_Labs_Holmdel_Complex), recently redeveloped, is undergoing a "tech renaissance" of sorts now, finding tenants such as Nvidia. At it's peak it employed over 6000 engineers on site. And it sits on a massive plot of land (complete with it's own substation, road salt facilities, wastewater treatment plant, AC plant, etc.), which is unfortunately now being developed into "luxury" homes. But maybe if Amazon started looking earlier than now when the facility was still dormant they would have found a suitable home here.
Hey yeah why not, I'd live in bits of Jersey. If I can work nearby in Jersey and be able hop on the PATH to The City on weekends, that doesn't sound half bad.
This makes a false assumption - that Amazon would be on top of existing job creation.
Cities already have models that assume/hope for a certain amount of job creation (and loss), with some of that being provided by new entrants to the area.
If existing businesses aren't meeting the model, they go out and find new sources. The jobs and housing numbers are separate (separate orgs, both flowing from the same model).
So, consider this more of a mayor being a salesman meeting their annual quota with a single sale. It's risky, but it's not an issue if it happens - they have already planned for success.
Now, if they aren't producing housing to meet their plan, that's an entirely different problem.
They also just built three new data centers in central Ohio and offered to partner with Ohio State. Columbus proper might be a good choice but I suspect they've got their eye on Dublin.
The requirements about the local labour pool and university system are nonsense. People can and will relocate to work for Amazon across the country and even across the world.
My take is that the RFP is a long-list of wants, not the short-list of must-haves. They want lots of suitors knocking on their door, to make the bidding process competitive.
The projections for Austin's population growth from two million inhabitants to four million by 2030 require an additional 167,000,000 housing units required.
This seems to be a problem but not uncommon even beyond Amazon.
The Boring Company has a solution for housing: tunnels with no traffic or stoplights. 200kph means you can live far from downtown and still be at work in 15 minutes.
“Without tunnels we’ll be in traffic hell forever” -Elon Musk
Wasn't that the promise made to us after World War II by automotive manufacturers? We built cars, we built highways - and the inner cities suffered, and then people stuck in suburban hell suffered.
How is this significantly better? We still have to distribute people from their houses to the tunnel, and from the tunnel to where they want to go.
I don't understand how that helps. You can't built very many 200mph tunnels, so housing at the ends will still have to be very dense or people will have to drive far to get to the stations. So this just shifts the housing density problem.
Shifting to a less hidebound / bureaucratic location is a great solution. Also: Elon’s goal is a more than 10x reduction in costs, and he’ll be able to charge related to the value of people’s time.
I think you're crazy to believe that if you go build a bunch of very dense housing anywhere, you won't shortly thereafter have a bunch of bureaucracy as a lot of people have to figure out how to live in close quarters.
Again, as near as I can tell, the best possible outcome of ultra high speed tunnel transport is you move the dense housing problem (or the traffic problem) elsewhere. That's not actually a solution. I also think it only appears easier than eg fixing sfbay's housing problems.
Run an S-bahn (https://en.wikipedia.org/wiki/S-train) through the tunnel for 10x the throughput of humans for a given tunneling cost. Cars are a profoundly inefficient use of space in a dense area.
The only way an auto tunnel network would solve traffic is by charging a sufficiently-high toll to match supply with demand. Otherwise, in an area dense enough that traffic congestion is a problem, induced demand will lead to congestion:
https://www.aeaweb.org/articles?id=10.1257/aer.101.6.2616
Boring Company tunnels are NOT for cars-only, they do envision public-transportation-like services which will be much better to move between dense areas:
The attractive areas of denser cities do tend to be more expensive than in less built-up areas. But there are plenty of cities that don't have housing prices from hell. Some also have fairly reasonable commuting times by rail although it's always going to take time to get from outside a city into a city.
Furthermore, there are plenty of companies and housing on the outskirts of cities where there are reasonable housing and commutes.
If everyone wants to live within 30 minutes of a Manhattan office, no, then there's probably no solution.
So what does Elon Musk know about boring that Martin Herrenknecht does not? I'd love to see some more affordable tunneling methods, but I'm not holding my breath.
Where is the data from? How does Detroit not have enough housing to support such a company? I'm guessing a lot of cities can build enough housing. Detroit especially has lots of housing--maybe not new builds in certain areas, but they are tearing down blocks of houses right now and people can buy houses for 15k. I question the article's data.
If you want housing that has had walls ripped off to get copper wire for selling to a scrap yard. Yes there is plenty of that.
If you want to pay housing boom sized taxes on a house worth a fraction of that, there is plenty of that as well. Since you aren't allowed to reappraise a lot of property.
A fair point. I'll agree that those properties are mostly not 'move-in' ready. However, the 4 year time period allows for redevelopment of properties. Also, my main point is that the author's data source is unclear. How do we know what was factored into the housing supply calculation?
Massive tax breaks and giveaways. That's all this is about. It's a dog and pony show to see who will fork up the most to buy in to the delusion that it will pay off somehow.